India's organic tea on the increase, mainly exported to France, Germany, Japan, the U.K. and the U.S.

6 December 2004, Rome - World tea production in 2003 reached 3.15 million tonnes, 75 000 tonnes more than in 2002, largely as a result of favourable weather conditions, according to a report released by FAO.

India accounted for 27.4% of world output, followed by China (24.6%), Sri Lanka (9.75%), and Kenya (9.4%). Production in India reached 857 000 tonnes in 2003, from 829 000 tonnes in the previous year.

In China, production was estimated at 791 000 tonnes, with green tea accounting for about 73%. In Kenya, production in 2003 was higher by 8 000 tonnes (+2.4%) as compared to the previous year, due to favourable weather conditions and the commissioning of five new manufacturing factories.

A significant indicator shows India's organic tea production still on the rise reaching 3 500 tonnes in 2003, with about 75% of it being exported to France, Germany, Japan, the United Kingdom and the United States.

Trade decreased

World tea exports reached 1.4 million tonnes in 2003, a 2.6% decline from the quantities shipped in 2002. Exports increases in China, Sri Lanka and Kenya were not sufficient to offset major declines in India and Indonesia.

Tea export from India fell by 13% to 173 000 tonnes, a nine year low, as a result of dramatic fall in shipments to Iraq under the "oil-for-food" programme, and weaker demand from the Russian Federation, the United Arab Emirates, and the United Kingdom

Global tea imports reached 1.39 million tonnes, about 1% more than 2002, reflecting the 3.2% gain by developing countries, where importers took advantage of low prices and rising domestic demand.

Firm prices

Despite record production, tea prices stood firm during 2003. The FAO composite price averaged US$1.48 per Kg from January to June 2003, and increased to an average of US$1.55 per Kg from July to December 2003 as a result of seasonal variation.

The average for 2003 was US$1.51 per Kg, 2.1 % higher than 2002. Prices opened at US$1.63 per Kg in 2004, then declined to US$1.49 per Kg in June, but recovered to US$1.67 per Kg in the first week of September 2004. These fluctuations reflect seasonal variability and ample supplies, according to the report.